Turnbull Creek Community Development District ANNUAL FINANCIAL REPORT September 30, 2022 Turnbull Creek Community Development District ANNUAL FINANCIAL REPORT September 30, 2022 TABLE OF CONTENTS Page Number REPORT OF INDEPENDENT AUDITORS 1-3 MANAGEMENT’S DISCUSSION AND ANALYSIS 4-9 BASIC FINANCIAL STATEMENTS: Government-wide Financial Statements: Statement of Net Position 10 Statement of Activities 11 Fund Financial Statements: Balance Sheet – Governmental Funds 12 Reconciliation of Total Governmental Fund Balances to Net Position of Governmental Activities 13 Statement of Revenues, Expenditures and Changes in Fund Balances – Governmental Funds 14 Reconciliation of the Statement of Revenues, Expenditures and Changes in Fund Balances of Governmental Funds to the Statement of Activities 15 Statement of Revenues, Expenditures and Changes in Fund Balances – Budget and Actual – General Fund 16 Notes to Financial Statements 17-28 INDEPENDENT AUDITORS’ REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS 29-30 MANAGEMENT LETTER 31-33 INDEPENDENT ACCOUNTANTS’ REPORT/COMPLIANCE WITH SECTION 218.415, FLORIDA STATUTES 34 REPORT OF INDEPENDENT AUDITORS To the Board of Supervisors Turnbull Creek Community Development District St. Johns County, Florida Report on Audit of the Financial Statements Opinion We have audited the financial statements of the governmental activities and each major fund of Turnbull Creek Community Development District (the “District”), as of and for the year ended September 30, 2022, and the related notes to financial statements, which collectively comprise the District’s basic financial statements as listed in the table of contents. In our opinion, the accompanying financial statements present fairly, in all material respects, the respective financial position of the governmental activities and each major fund of Turnbull Creek Community Development District as of September 30, 2022, and the respective changes in financial position and the budgetary comparison for the General Fund for the year then ended in accordance with accounting principles generally accepted in the United States of America. Basis for Opinion We conducted our audits in accordance with auditing standards generally accepted in the United States of America (GAAS), and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of the District and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audits. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. To the Board of Supervisors Turnbull Creek Community Development District In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the District’s ability to continue as a going concern for one year beyond the financial statement date, including currently known information that may raise substantial doubt thereafter. Auditor’s Responsibility for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore, is not a guarantee that an audit conducted in accordance with GAAS and Government Auditing Standards will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users made on the basis of these financial statements. In performing an audit in accordance with GAAS and Government Auditing Standards, we: • Exercise professional judgement and maintain professional skepticism throughout the audit. • Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining on a test basis, evidence regarding the amounts and disclosures in the financial statements. • Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the District’s internal control. Accordingly, no such opinion is expressed. • Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. • Conclude whether, in our judgement, there are conditions or events, considered in the aggregate, that raise substantial doubt about the District’s ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control related matters that we identified during the audit. To the Board of Supervisors Turnbull Creek Community Development District Required Supplementary Information Accounting principles generally accepted in the United States of America require that Management’s Discussion and Analysis be presented to supplement the basic financial statements. Such information is the responsibility of management and, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance with auditing standards generally accepted in the United States of America, which consisted of inquiries of management about the methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries, the basic financial statements, and other knowledge obtained during our audit of the basic financial statements. We do not express an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any assurance. Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued a report dated October 2, 2023 on our consideration of the District’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations and contracts. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering Turnbull Creek Community Development District’s internal control over financial reporting and compliance. Berger, Toombs, Elam, Gaines & Frank Certified Public Accountants PL Fort Pierce, Florida October 2, 2023 Management’s discussion and analysis of Turnbull Creek Community Development District’s (the “District”) financial performance provides an objective and easily readable analysis of the District’s financial activities. The analysis provides summary financial information for the District and should be read in conjunction with the District’s financial statements. OVERVIEW OF THE FINANCIAL STATEMENTS The District’s basic financial statements comprise three components; 1) government-wide financial statements, 2) fund financial statements, and 3) notes to financial statements. The government-wide financial statements present an overall picture of the District’s financial position and results of operations. The fund financial statements present financial information for the District’s major funds. The notes to financial statements provide additional information concerning the District’s finances. The government-wide financial statements are the statement of net position and the statement of activities. These statements use accounting methods similar to those used by private-sector companies. Emphasis is placed on the net position of governmental activities and the change in net position. Governmental activities are primarily supported by special assessments. The statement of net position presents information on all assets and liabilities of the District, with the difference between assets and liabilities reported as net position. Assets, liabilities, and net position are reported for all Governmental activities. The statement of activities presents information on all revenues and expenses of the District and the change in net position. Expenses are reported by major function and program revenues relating to those functions are reported, providing the net cost of all functions provided by the District. To assist in understanding the District’s operations, expenses have been reported as governmental activities. Governmental activities financed by the District include general government, physical environment, culture and recreation, and debt service. Fund financial statements present financial information for governmental funds. These statements provide financial information for the major funds of the District. Governmental fund financial statements provide information on the current assets and liabilities of the funds, changes in current financial resources (revenues and expenditures), and current available resources. OVERVIEW OF THE FINANCIAL STATEMENTS (CONTINUED) Fund financial statements include a balance sheet and a statement of revenues, expenditures and changes in fund balances for all governmental funds. A statement of revenues, expenditures, and changes in fund balances – budget and actual is provided for the District’s General Fund. Fund financial statements provide more detailed information about the District’s activities. Individual funds are established by the District to track revenues that are restricted to certain uses or to comply with legal requirements. The government-wide financial statements and the fund financial statements provide different pictures of the District. The government-wide financial statements provide an overall picture of the District’s financial standing. These statements are comparable to private-sector companies and give a good understanding of the District’s overall financial health and how the District paid for the various activities, or functions, provided by the District. All assets of the District, including capital assets, are reported in the statement of net position. All liabilities, including principal outstanding on bonds are included. In the statement of activities, transactions between the different functions of the District have been eliminated in order to avoid “doubling up” the revenues and expenses. The fund financial statements provide a picture of the major funds of the District. In the case of governmental activities, outlays for long lived assets are reported as expenditures and long-term liabilities, such as general obligation bonds, are not included in the fund financial statements. To provide a link from the fund financial statements to the government-wide financial statements, reconciliation is provided from the fund financial statements to the government-wide financial statements. Notes to financial statements provide additional detail concerning the financial activities and financial balances of the District. Additional information about the accounting practices of the District, investments of the District, capital assets and long-term debt are some of the items included in the notes to financial statements. Financial Highlights The following are the highlights of financial activity for the year ended September 30, 2022. . The District’s total liabilities exceeded total assets by $(1,584,152) (net position). Net investment in capital assets was $(2,518,668), restricted net position was $107,652 and unrestricted net position was $826,864. . Governmental activities revenues totaled $2,612,616 while governmental activities expenses totaled $2,246,664. OVERVIEW OF THE FINANCIAL STATEMENTS (CONTINUED) Financial Analysis of the District The following schedule provides a summary of the assets, liabilities and net position of the District and is presented by category for comparison purposes. Net Position The decrease in capital assets is mainly related to current year depreciation. 20222021Current assets848,135$ 859,917$ Restricted assets988,023 986,857 Capital assets10,730,563 11,188,521 Total Assets 12,566,721 13,035,295 Current liabilities1,033,585 1,049,648 Non-current liabilities13,117,288 13,935,751 Total Liabilities14,150,873 14,985,399 Net investment in capital assets(2,518,668) (2,849,030) Restricted net postion107,652 109,373 Unrestricted net position826,864 789,553 Total Net Position (1,584,152)$ (1,950,104)$ Governmental Activities The increase in net position is the result of revenues in excess of expenses in the current year. The decrease in non-current liabilities is related to the principal payments made in the current year. OVERVIEW OF THE FINANCIAL STATEMENTS (CONTINUED) Financial Analysis of the District (Continued) The following schedule provides a summary of the changes in net position of the District and is presented by category for comparison purposes. Change In Net Position The increase in physical environment is mainly the result of the increase in field services, security monitoring services, insurance and repairs in the current year. 20222021Program Revenues Charges for services2,593,871$ 2,509,048$ Investment earnings4,703 372 Miscellaneous revenues14,042 19,661 Total Revenues2,612,616 2,529,081 Expenses General government171,016 175,189 Physical environment866,531 576,514 Culture/recreation612,380 723,309 Interest and other charges596,737 626,386 Total Expenses2,246,664 2,101,398 Change in Net Position365,952 427,683 Net Position - Beginning of Year(1,950,104) (2,377,787) Net Position - End of Year(1,584,152)$ (1,950,104)$ Governmental Activities The decrease in culture/recreation is related to the decrease in repairs in the current year. OVERVIEW OF THE FINANCIAL STATEMENTS (CONTINUED) Capital Assets Activity The following schedule provides a summary of the District’s capital assets as of September 30, 2022 and 2021. Current year activity consisted of depreciation of $457,958. General Fund Budgetary Highlights 20222021Land and improvements3,846,133$ 3,846,133$ Infrastructure5,052,657 5,052,657 Buildings8,344,455 8,344,455 Equipment19,046 19,046 Less: accumulated depreciation(6,531,728) (6,073,770) Capital Assets, net10,730,563$ 11,188,521$ Governmental Activities Actual expenditures exceeded budgeted expenditures primarily due to more reserve and repairs and maintenance expenditures incurred in the current year than were anticipated. The September 30, 2022 budget was not amended. Debt Management Governmental Activities debt includes the following: . In March 2015, the District issued $13,375,000 Special Assessment Refunding Bonds, Series 2015A and $1,280,000 Special Assessment Bonds, Series 2015B. The Bonds were issued to provide funds to refund and redeem the Special Assessment Bonds, Series 2005 and to finance the Phase 1 - Pond Bank Reconstruction Project. The balance outstanding at September 30, 2022 for the Series 2015A Bonds was $9,585,000 and the Series 2015B Bonds was $1,075,000. OVERVIEW OF THE FINANCIAL STATEMENTS (CONTINUED) Debt Management (Continued) In April 2016, the District issued $4,196,000 Special Assessment Refunding Bonds, Series 2016. The Bonds were issued to refund and redeem the outstanding Special Assessment Bonds, Series 2006 and retire the deferred costs. The balance outstanding at September 30, 2022 was $3,278,000. Economic Factors and Next Year’s The District does not expect any economic factors to have a significant effect on the financial position or results of operations of the District in fiscal year 2023. Request for Information The financial report is designed to provide a general overview of Turnbull Creek Community Development District’s finances for all those with an interest. Questions concerning any of the information provided in this report or requests for additional information should be addressed to the Turnbull Creek Community Development District’s Accounting Department at 3434 Colwell Avenue, Suite 200, Tampa, Florida, 33614. Turnbull Creek Community Development DistrictSTATEMENT OF NET POSITIONSeptember 30, 2022GovernmentalActivitiesASSETSCurrent AssetsCash$ 576,147Investments238,315Accounts receivable1,894Prepaid expenses31,479Deposits300Total Current Assets848,135Non-Current AssetsRestricted AssetsInvestments988,023Capital Assets, Not Being DepreciatedLand and improvements3,846,133Capital Assets, Being DepreciatedInfrastucture5,052,657Buildings8,344,455Equipment19,046Less: accumulated depreciation(6,531,728) Total Non-Current Assets11,718,586Total Assets12,566,721LIABILITIESCurrent LiabilitiesAccounts payable21,271Bonds payable, current772,000Accrued interest240,314Total Current Liabilities1,033,585Non-Current LiabilitiesBonds payable, net13,117,288Total Liabilities14,150,873NET POSITIONNet investment in capital assets(2,518,668) Restricted for debt service104,896Restricted for capital projects2,756Unrestricted 826,864Total Net Position$ (1,584,152) See accompanying notes to financial statements. - 10 - Turnbull Creek Community Development DistrictSTATEMENT OF ACTIVITIESFor the Year Ended September 30, 2022 Net (Expense) Revenues andProgramChanges inRevenuesNet PositionCharges forGovernmentalFunctions/ProgramsExpensesServicesActivities Governmental Activities General government(171,016)$ 174,349$ 3,333$ Physical environment(866,531)709,088(157,443) Culture/recreation(612,380)331,765(280,615) Interest and other charges(596,737)1,378,669781,932 Total Governmental Activities(2,246,664)$ 2,593,871$ 347,207General Revenues Investment earnings4,703 Miscellaneous revenues14,042 Total General Revenues18,745 Change in Net Position365,952Net Position - October 1,2021(1,950,104) Net Position - September 30, 2022$ (1,584,152) See accompanying notes to financial statements. - 11 - Turnbull Creek Community Development DistrictBALANCE SHEET - GOVERNMENTAL FUNDSSeptember 30, 2022 TotalGovernmental GeneralDebt ServiceCapital ProjectsFundsASSETSCash$ 576,147$ -$ -$ 576,147Investments238,315--238,315Accounts receivable1,894--1,894Prepaid expenses31,479--31,479Deposits300--300Restricted assets Cash and investments, at fair value-985,2672,756988,023 Total Assets$ 848,135$ 985,267$ 2,756$ 1,836,158 LIABILITIES AND FUND BALANCES LIABILITIESAccounts payable$ 21,271$ -$ -$ 21,271 FUND BALANCESNonspendable: Prepaid expenses/deposits31,779--31,779 Restricted: Debt service -985,267-985,267Capital projects--2,7562,756 Assigned - capital projects454,424--454,424Unassigned340,661--340,661 Total Fund Balances826,864985,2672,7561,814,887 Total Liabilities and Fund Balances$ 848,135$ 985,267$ 2,756$ 1,836,158 See accompanying notes to financial statements. - 12 - Turnbull Creek Community Development DistrictRECONCILIATION OF TOTAL GOVERNMENTAL FUND BALANCESTO NET POSITION OF GOVERNMENTAL ACTIVITIESSeptember 30, 2022 Total Governmental Fund Balances$ 1,814,887Amounts reported for governmental activities in the Statement of Net Positionare different because: Capital assets, land and improvements, $3,846,133,infrastructure, $5,052,657, buildings, $8,344,455, and equipment, $19,046, netofaccumulated depreciation, $(6,531,728), used in governmental activitiesat the fund level. are notcurrent financial resources and therefore, are not reported10,730,563Long-term liabilities, including bonds payable, $(13,938,000), net of bondand therefore, are not reported at the governmental fund level. discount, net, $48,712, are not due and payable in the current period (13,889,288) Accrued interest expense for long-term debt is not a current financial useand therefore, is not reported at the governmental fund level.(240,314) Net Position of Governmental Activities$ (1,584,152) See accompanying notes to financial statements. - 13 - Turnbull Creek Community Development DistrictSTATEMENT OF REVENUES, EXPENDITURES AND CHANGESIN FUND BALANCES – GOVERNMENTAL FUNDSFor the Year Ended September 30, 2022TotalGovernmentalGeneralDebt ServiceCapital ProjectsFundsRevenues Special assessments$1,215,202$ 1,378,669-$ 2,593,871$ Investment earnings364,655124,703 Miscellaneous revenues14,042--14,042 Total Revenues1,229,2801,383,324122,612,616Expenditures Current General government171,016--171,016 Physical environment695,531--695,531 Culture/recreation325,422--325,422 Debt service Principal-790,000-790,000 Interest-604,949-604,949 Total Expenditures1,191,9691,394,949-2,586,918Net Change in Fund Balances37,311(11,625)1225,698Fund Balances - October 1, 2021789,553996,8922,7441,789,189Fund Balances - September 30, 2022826,864$ 985,267$ 2,756$ 1,814,887$ See accompanying notes to financial statements. - 14 - Turnbull Creek Community Development DistrictRECONCILIATION OF THE STATEMENT OF REVENUES, EXPENDITURESAND CHANGES IN FUND BALANCES OF GOVERNMENTAL FUNDSTO THE STATEMENT OF ACTIVITIESFor the Year Ended September 30, 2022 Net Change in Fund Balances - Total Governmental Funds$ 25,698Amounts reported for governmental activities in the Statement of Activities aredifferent because: in the current period. Governmental funds report capital outlays as expenditures. However, in theStatement of Activities, the cost of those assets is allocated over theirestimated useful lives as depreciation. This is the amount of depreciation(457,958) Bond principal payments are recorded as expenditures at the fund level, butreduce liabilities at the government-wide level.790,000Amortization of bond discount does not require the use of financial currentresources and therefore, is not reported at the fund level. This is the amount of amortization in the current period.(3,537) when due. This is the change in accrued interest in the current period. whereas in the governmental funds, interest expenditures are reportedIn the Statement of Activities, interest is accrued on outstanding bonds; 11,749Change in Net Position of Governmental Activities$ 365,952 See accompanying notes to financial statements. - 15 - Turnbull Creek Community Development DistrictSTATEMENT OF REVENUES, EXPENDITURES AND CHANGES INFUND BALANCES – BUDGET AND ACTUAL – GENERAL FUNDFor the Year Ended September 30, 2022 Revenues Special assessments Investment earnings Miscellaneous revenues Total Revenues Expenditures Current General government Physical environment Culture/recreation Total Expenditures Net Change in Fund Balances Fund Balances - October 1, 2021 Fund Balances - September 30, 2022 OriginalFinalBudgetBudget$1,207,047$1,207,047-- 5,0005,000 1,212,047 163,238704,080298,4561,165,774 46,273 431,266 $ 477,539 1,212,047 163,238704,080298,4561,165,774 46,273 431,266 $ 477,539 ActualVariance withFinal BudgetPositive(Negative) $1,215,2023614,0421,229,280$ 8,155369,04217,233171,016695,531325,4221,191,969(7,778) 8,549(26,966) (26,195) 37,311(8,962) 789,553358,287826,864$ 349,325$ See accompanying notes to financial statements. - 16 - NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The financial statements of the District have been prepared in conformity with generally accepted accounting principles (GAAP) as applied to governmental units. The Governmental Accounting Standards Board (GASB) is the accepted standard-setting body for establishing governmental accounting and financial reporting principles. The District's more significant accounting policies are described below. 1. Reporting Entity The District was established on June 28, 2004, pursuant to the Uniform Community Development District Act of 1980, Chapter 190, Florida Statutes, as amended (the "Act"), by Ordinance #2004-47 of the Board of County Commissioners of St. Johns County, as a Community Development District. The District was established for the purposes of financing and managing the acquisition, construction, maintenance and operation of the infrastructure necessary for community development within its jurisdiction. The District is authorized to issue bonds for the purpose, among others, of financing, funding, planning, establishing, acquiring, constructing district roads, landscaping, and other basic infrastructure projects within or outside the boundaries of the Turnbull Creek Community Development District. The District is governed by a five member Board of Supervisors elected by qualified resident electors residing within the District. The District operates within the criteria established by Chapter 190, Florida Statutes. As required by GAAP, these financial statements present the Turnbull Creek Community Development District (the primary government) as a stand-alone government. The reporting entity for the District includes all functions of government in which the District’s Board exercises oversight responsibility including, but not limited to, financial interdependency, selection of governing authority, designation of management, significant ability to influence operations and accountability for fiscal matters. Based upon the application of the above-mentioned criteria as set forth in Governmental Accounting Standards the District has identified no component units. 2. Measurement Focus and Basis of Accounting The basic financial statements of the District are composed of the following: • Government-wide financial statements • Fund financial statements • Notes to financial statements NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 2. Measurement Focus and Basis of Accounting (Continued) a. Government-wide Financial Statements The government-wide financial statements are reported using the economic resources measurement focus and the accrual basis of accounting. Government- wide financial statements report all non-fiduciary information about the reporting government as a whole. These statements include all the governmental activities of the primary government. The effect of interfund activity has been removed from these statements. Governmental activities are supported by special assessments. Program revenues are netted with program expenses in the statement of activities to present the net cost of each program. Amounts paid to acquire capital assets are capitalized as assets, rather than reported as an expenditure. Proceeds of long-term debt are recorded as liabilities in the government-wide financial statements, rather than as an other financing source. Amounts paid to reduce long-term indebtedness of the reporting government are reported as a reduction of the related liability, rather than as an expenditure. b. Fund Financial Statements The underlying accounting system of the District is organized and operated on the basis of separate funds, each of which is considered to be a separate accounting entity. The operations of each fund are accounted for with a separate set of self- balancing accounts that comprise its assets, liabilities, fund equity, revenues and expenditures or expenses, as appropriate. Governmental resources are allocated to and accounted for in individual funds based upon the purposes for which they are to be spent and the means by which spending activities are controlled. Fund financial statements for the primary government’s governmental funds are presented after the government-wide financial statements. These statements display information about major funds individually. NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 2. Measurement Focus and Basis of Accounting (Continued) b. Fund Financial Statements (Continued) Governmental Funds The District reports fund balance according to Governmental Accounting Standards Board Statement 54 – Fund Balance Reporting and Governmental Fund Type Definitions. The Statement requires the fund balance for governmental funds to be reported in classifications that comprise a hierarchy based primarily on the extent to which the government is bound to honor constraints on the specific purposes for which amounts in those funds can be spent. The District has various policies governing the fund balance classifications. Nonspendable Fund Balance – This classification consists of amounts that cannot be spent because they are either not in spendable form or are legally or contractually required to be maintained intact. Restricted Fund Balance – This classification includes amounts that can be spent only for specific purposes stipulated by constitution, external resource providers, or through enabling legislation. Assigned Fund Balance – This classification consists of the Board of Supervisors’ intent to be used for specific purposes, but are neither restricted nor committed. The assigned fund balances can also be assigned by the District’s management company. Unassigned Fund Balance – This classification is the residual classification for the government’s general fund and includes all spendable amounts not contained in the other classifications. Unassigned fund balance is considered to be utilized first when an expenditure is incurred for purposes for which amounts in any of those unrestricted fund balance classifications could be used. Fund Balance Spending Hierarchy – For all governmental funds except special revenue funds, when restricted, committed, assigned, and unassigned fund balances are combined in a fund, qualified expenditures are paid first from restricted or committed fund balance, as appropriate, then assigned and finally unassigned fund balances. NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 2. Measurement Focus and Basis of Accounting (Continued) b. Fund Financial Statements (Continued) Governmental Funds (Continued) Governmental fund financial statements are reported using the current financial resources measurement focus and the modified accrual basis of accounting. Revenues are considered to be available when they are collected within the current period or soon thereafter to pay liabilities of the current period. For this purpose, the District considers revenues to be available if they are collected within 60 days of the end of the current fiscal period. Expenditures generally are recorded when a liability is incurred, as under accrual accounting. Interest associated with the current fiscal period is considered to be an accrual item and so has been recognized as revenue of the current fiscal period. Under the current financial resources measurement focus, only current assets and current liabilities are generally included on the balance sheet. The reported fund balance is considered to be a measure of “available spendable resources”. Governmental fund operating statements present increases (revenues and other financing sources) and decreases (expenditures and other financing uses) in net current assets. Accordingly, they are said to present a summary of sources and uses of “available spendable resources” during a period. Because of their spending measurement focus, expenditure recognition for governmental fund types excludes amounts represented by non-current liabilities. Since they do not affect net current assets, such long-term amounts are not recognized as governmental fund type expenditures or fund liabilities. Amounts expended to acquire capital assets are recorded as expenditures in the year that resources are expended, rather than as fund assets. The proceeds of long- term debt are recorded as an other financing source rather than as a fund liability. Debt service expenditures are recorded only when payment is due. 3. Basis of Presentation a. Governmental Major Funds General Fund – The General Fund is the District’s primary operating fund. It accounts for all financial resources of the general government, except those required to be accounted for in another fund. NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 3. Basis of Presentation (Continued) a. Governmental Major Funds (Continued) Debt Service Fund – The Debt Service Fund accounts for debt service requirements to retire the Special Assessment Bonds. Capital Projects Fund – The Capital Projects Fund accounts for the acquisition and construction of infrastructure improvements located within the boundaries of the District. b. Non-current Governmental Assets/Liabilities GASB Statement 34 requires that non-current governmental assets, such as construction in progress, and non-current governmental liabilities, such as general obligation bonds be reported in the governmental activities column in the government-wide Statement of Net Position. 4. Assets, Liabilities, and Net Position or Equity a. Cash and Investments Florida Statutes require state and local governmental units to deposit monies with financial institutions classified as "Qualified Public Depositories," a multiple financial institution pool whereby groups of securities pledged by the various financial institutions provide common collateral from their deposits of public funds. This pool is provided as additional insurance to the federal depository insurance and allows for additional assessments against the member institutions, providing full insurance for public deposits. The District is authorized to invest in those financial instruments as established by Section 218.415, Florida Statutes. The authorized investments consist of: 1. Direct obligations of the United States Treasury; 2. The Local Government Surplus Funds Trust or any intergovernmental investment pool authorized pursuant to the Florida Interlocal Cooperative Act of 1969; 3. Interest-bearing time deposits or savings accounts in authorized qualified public depositories; NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 4. Assets, Liabilities, and Net Position or Equity (Continued) a. Cash and Investments (Continued) 4. Securities and Exchange Commission, registered money market funds with the highest credit quality rating from a nationally recognized rating agency. Cash and investments include time deposits, certificates of deposit, money market funds, and all highly liquid debt instruments with original maturities of three months or less. b. Restricted Assets Certain net position of the District are classified as restricted assets on the Statement of Net Position because their use is limited either by law through constitutional provisions or enabling legislation; or by restrictions imposed externally by creditors. In a fund with both restricted and unrestricted net position, qualified expenses are considered to be paid first from restricted net position and then from unrestricted net position. c. Capital Assets Capital assets, which include land, infrastructure, equipment and buildings, are reported in the governmental activities column. The District defines capital assets as assets with an initial, individual cost of $5,000 or more and an estimated useful life in excess of two years. The valuation basis for all assets is historical cost. The costs of normal maintenance and repairs that do not add to the value of the asset or materially extend its useful life are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed. Depreciation of capital assets is computed and recorded by utilizing the straight-line method. Estimated useful lives of the various classes of depreciable capital assets are as follows: Building 10-30 years Infrastructure 30 years Equipment 5–7 years NOTE A – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) 4. Assets, Liabilities, and Net Position or Equity (Continued) d. Unamortized Bond Discounts Bond discounts associated with the issuance of revenue bonds are amortized according to the straight line method of accounting. For financial reporting, unamortized bond discounts are netted against the applicable long-term debt. e. Budgets Budgets are prepared and adopted after public hearings for the governmental funds, pursuant to Chapter 190, Florida Statutes. The District utilizes the same basis of accounting for budgets as it does for revenues and expenditures in its various funds. The legal level of budgetary control is at the fund level. All budgeted appropriations lapse at year end. Formal budgets are adopted for the general and debt service funds. As a result, deficits in the budget columns of the accompanying financial statements may occur. NOTE B – CASH AND INVESTMENTS All deposits are held in qualified public depositories and are included on the accompanying balance sheet as cash and investments. Custodial Credit Risk – Deposits Custodial credit risk is the risk that in the event of a bank failure, the District's deposits may not be returned to it. The District does not have a formal deposit policy for custodial credit risk, however, they follow the provisions of Chapter 280, Florida Statutes regarding deposits and investments. As of September 30, 2022, the District's bank balance was $682,498 and the carrying value was $576,147. Exposure to custodial credit risk was as follows. The District maintains all deposits in a qualified public depository in accordance with the provisions of Chapter 280, Florida Statutes, which means that all deposits are fully insured by Federal Depositors Insurance or collateralized under Chapter 280, Florida Statutes. NOTE B – CASH AND INVESTMENTS (CONTINUED) Investments As of September 30, 2022, the District had the following investments and maturities: The District categorizes its fair value measurements within the fair value hierarchy recently established by generally accepted accounting principles. The fair value is the price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the measurement date. The hierarchy is based on the valuation inputs used to measure the fair value of the asset. The District uses a market approach in measuring fair value that uses prices and other relevant information generated by market transactions involving identical or similar assets, liabilities, or groups of assets and liabilities. Assets or liabilities are classified into one of three levels. Level 1 is the most reliable and is based on quoted price for identical assets, or liabilities, in an active market. Level 2 uses significant other observable inputs when obtaining quoted prices for identical or similar assets, or liabilities, in markets that are not active. Level 3 is the least reliable and uses significant unobservable inputs that use the best information available under the circumstances, which includes the District’s own data in measuring unobservable inputs. Based on the criteria in the preceding paragraph, the investments in First American Government Obligation Fund and Goldman Sachs Government Fund are Level 1 assets. InvestmentMaturityFair ValueFirst American Government Obligation Fund 18 days*803,752$ Goldman Sachs Government Fund22 days*184,271 US Bank Money MarketN/A238,272 Florida PRIME 21 days*43 Total1,226,338$ * Weighted average maturity The District’s investment policy allows management to invest funds in investments permitted under Section 218.415, Florida Statutes. The investment in Florida PRIME is measured at amortized cost. Florida PRIME has established policies and guidelines regarding participant transactions and the authority to limit or restrict withdrawals or impose a penalty for an early withdrawal. As of September 30, 2022, there were no redemption fees, maximum transaction amounts, or any other requirement that would limit daily access to 100 percent of the account value. Interest Rate Risk The District does not have a formal investment policy that limits investment maturities as a means of managing its exposure to fair value losses arising from increasing interest rates. NOTE B – CASH AND INVESTMENTS (CONTINUED) Credit Risk The District's investments are limited by state statutory requirements and bond compliance. The District has no investment policy that would further limit its investment choices. As of September 30, 2022, the District's investment in the Goldman Sachs Government Fund, Florida PRIME, and First American Government Obligation Fund were rated AAAm by Standard & Poor's. Concentration of Credit Risk The District places no limit on the amount it may invest in any one fund. The investments in First American Government Obligation Fund represent 66% of the District's total investments. The investments in Goldman Sachs Government Fund represent 15% of the District’s total investments. The US Bank Money Market represents 19% of the Districts total investments. The District’s investment in Florida PRIME represents less than 1% of the District’s total investments. The types of deposits and investments and their level of risk exposure as of September 30, 2022 were typical of these items during the fiscal year then ended. NOTE C – CAPITAL ASSETS Capital Asset activity for the year ended September 30, 2022 was as follows: Depreciation was charged to physical environment, $171,000, and culture and recreation, $286,958. BalanceBalanceOctober 1,September 30,2021AdditionsDeletions2022Governmental Activities: Capital assets, not being depreciated: Land and improvements3,846,133$ -$ -$ 3,846,133$ Capital assets being depreciated Infrastucture5,052,657 - - 5,052,657 Buildings8,344,455 - - 8,344,455 Equipment19,046 - - 19,046 Total Capital Assets Being Depreciated13,416,158 - - 13,416,158 Less: accumulated depreciation(6,073,770) (457,958) - (6,531,728) Total Capital Assets Being Depreciated, Net7,342,388 (457,958) - 6,884,430 Governmental Activites Capital Assets, Net11,188,521$ (457,958)$ -$ 10,730,563$ NOTE D – SPECIAL ASSESSMENT REVENUES Assessments are non-ad valorem assessments on benefitted property within the District. Operating and Maintenance Assessments are based upon adopted budget and levied annually. Debt Service Assessments are levied when bonds are issued and collected annually for the term of the bond. The District may collect assessments directly or utilize the uniform method of collection (Chapter 197.3632, Florida Statutes). Directly collected assessments are due as determined by annual assessment resolution adopted by the Board of Supervisors. Assessments collected under the uniform method are mailed by County Tax Collector on November 1 and due on or before March 31 of each year. Property owners may prepay a portion or all of the Debt Service Assessments on their property subject to various provisions in the bond documents. Assessments and interest associated with the current fiscal period are all considered to be susceptible to accrual and so have been recognized as revenues of the current fiscal period. Only the portion of assessments receivable due within the current fiscal period is considered to be susceptible to accrual as revenue of the current period. All other revenue items are considered to be measurable and available only when cash is received by the government. NOTE E – LONG-TERM DEBT The following is a summary of activity in the long-term debt account group of the District for the year ended September 30, 2022: Long-term debt at October 1, 2021 $ 14,728,000 Principal payments (790,000) Long-term Debt at September 30, 2022 13,938,000 Less: bond discount, net (48,712) Bonds Payable, Net $ 13,889,288 Long-term debt is comprised of the following: Special Assessment Refunding Bonds $13,375,000 Series 2015A Bonds are due in annual principal installments beginning May 2016, maturing May 2035. Interest is due semi-annually on May 1 and November 1, beginning May 1, 2016, at variable rates of 1.25% to 4.75%. $ 9,585,000 $1,280,000 Series 2015B Bonds are due in annual principal installments beginning May 2016, maturing May 2045. Interest is due semi-annually on May 1 and November 1, beginning May 1, 2016, at variable rates of 1.25% to 5.00%. $ 1,075,000 $4,196,000 Series 2016 Bonds are due in annual principal installments beginning May 2017, maturing May 2037. Interest is due semi-annually on May 1 and November 1, beginning May 1, 2016, at fixed rate of 3.70%. $ 3,278,000 NOTE E – LONG-TERM DEBT (CONTINUED) The annual requirements to amortize the principal and interest of bonded debt outstanding as of September 30, 2022 are as follows: Significant Bond Provisions Year EndingSeptember 30,PrincipalInterestTotal2023 $ 772,000 $ 576,754 $ 1,348,754 2024 798,000 548,385 1,346,385 2025 834,000 517,796 1,351,796 2026 866,000 485,261 1,351,261 2027 883,000 450,939 1,333,939 2028-2032 5,140,000 1,660,265 6,800,265 2033-2037 4,145,000 522,745 4,667,745 2038-2042 285,000 89,788 374,788 2043-2045 215,000 20,025 235,025 Totals $ 13,938,000 $ 4,871,958 $ 18,809,958 The Series 2015A, 2015B and 2016 Bonds are subject to redemption at the option of the District prior to their maturity, in whole or in part, in the manner provided by the Bond Indenture. The Bonds are also subject to extraordinary mandatory redemption in the manner determined by the Bond Registrar if certain events occur as outline in the Bond Indenture. The Trust Indenture established certain amounts be maintained in a reserve account. In addition, the Trust Indenture has certain restrictions and requirements relating principally to the use of proceeds to pay for the infrastructure improvements and the procedures to be followed by the District on assessments to property owners. The District agrees to levy special assessments in annual amounts adequate to provide payment of debt service and to meet the reserve requirements. NOTE E – LONG-TERM DEBT (CONTINUED) Depository Funds The bond resolution establishes certain funds and determines the order in which revenues are to be deposited into these funds. A description of the significant funds, including their purposes, is as follows: 1. Reserve Fund – The 2016 Reserve Account was funded from the proceeds of the Series 2016 Bonds in an amount equal to the maximum annual debt service requirement. Monies held in the reserve account will be used only for the purposes established in the Trust Indenture. NOTE F – RISK MANAGEMENT The District is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors and omissions; and natural disasters for which the government carries commercial insurance. There were no claims or settled claims from these risks that exceeded commercial insurance coverage in the past three years. NOTE G – SUBSEQUENT EVENT Series 2015A Special Assessment Bonds $ 547,128 $ 490,498 Series 2015B Special Assessment Bonds $ 56,530 $ 35,480 Series 2016 Special Assessment Bonds $ 114,988 $ 114,079 Reserve BalanceReserve Requirement In May 2023, the District made prepayments on the Series 2015A and 2015B Bonds in the amounts of $40,000 and $10,000, respectively. INDEPENDENT AUDITORS’ REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING AND ON COMPLIANCE AND OTHER MATTERS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS To the Board of Supervisors Turnbull Creek Community Development District St. Johns County, Florida We have audited, in accordance with the auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards issued by the Comptroller General of the United States, the financial statements, as listed in the table of contents, of Turnbull Creek Community Development District, as of and for the year ended September 30, 2022, and the related notes to the financial statements, which collectively comprise the basic financial statements and have issued our report thereon dated October 2, 2023. Report on Internal Control Over Financial Reporting In planning and performing our audit, we considered Turnbull Creek Community Development District's internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinions on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of Turnbull Creek Community Development District’s internal control. Accordingly, we do not express an opinion on the effectiveness of Turnbull Creek Community Development District's internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct misstatements on a timely basis. A material weakness is a deficiency, or combination of deficiencies, in internal control, such that there is a reasonable possibility that a material misstatement of the entity's financial statements will not be prevented or detected and corrected on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses or significant deficiencies may exist that have not been identified. To the Board of Supervisors Turnbull Creek Community Development District Report on Compliance and Other Matters As part of obtaining reasonable assurance about whether Turnbull Creek Community Development District's financial statements are free of material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the determination of financial statement amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. Purpose of this Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Berger, Toombs, Elam, Gaines & Frank Certified Public Accountants PL Fort Pierce, Florida October 2, 2023 MANAGEMENT LETTER To the Board of Supervisors Turnbull Creek Community Development District St. Johns County, Florida Report on the Financial Statements We have audited the financial statements of the Turnbull Creek Community Development District as of and for the year ended September 30, 2022, and have issued our report thereon dated October 2, 2023. Auditor’s Responsibility We conducted our audit in accordance with auditing standards generally accepted in the United States; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States and Chapter 10.550, Rules of the Florida Auditor General. Other Reporting Requirements We have issued our Independent Auditor’s Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards and our Independent Auditor’s Report on an examination conducted in accordance with AICPA Professionals Standards, AT-C Section 315, regarding compliance requirements in accordance with Chapter 10.550, Rules of the Auditor General. Disclosures in those reports, which are dated October 2, 2023, should be considered in conjunction with this management letter. Prior Audit Findings Section 10.554(1)(i)1., Rules of the Auditor General, requires that we determine whether or not corrective actions have been taken to address findings and recommendations made in the preceding financial audit report. There were no findings or recommendations in the preceding financial audit report. Financial Condition and Management Section 10.554(1)(i)5.a. and 10.556(7), Rules of the Auditor General, require us to apply appropriate procedures and communicate the results of our determination as to whether or not Turnbull Creek Community Development District has met one or more of the conditions described in Section 218.503(1), Florida Statutes, and to identify the specific conditions met. In connection with our audit, we determined that Turnbull Creek Community Development District did not meet any of the conditions described in Section 218.503(1), Florida Statutes. To the Board of Supervisors Turnbull Creek Community Development District Pursuant to Sections 10.554(1)(i)5.b. and 10.556(8), Rules of the Auditor General, we applied financial condition assessment procedures for Turnbull Creek Community Development District. It is management’s responsibility to monitor the Turnbull Creek Community Development District’s financial condition; our financial condition assessment was based in part on the representations made by management and the review of the financial information provided by the same as of September 30, 2022. Section 10.554(1)(i)2., Rules of the Auditor General, requires that we communicate any recommendations to improve financial management. In connection with our audit, we did not have any such recommendations. Specific Information The information provided below was provided by management and has not been audited; therefore, we do not express an opinion or provide any assurance on the information. As required by Section 218.39(3)(c) and Section 218.32(1)(c), Florida Statutes, and Section 10.554(1)(i)6, Rules of the Auditor General, the Turnbull Creek Community Development District reported: 1) The total number of district employees compensated in the last pay period of the District’s fiscal year: 4 2) The total number of independent contractors to whom nonemployee compensation, defined as individuals or entities that receive 1099s, was paid in the last month of the District’s fiscal year: 9 3) All compensation earned by or awarded to employees, whether paid or accrued, regardless of contingency: $6,400 4) All compensation earned by or awarded to nonemployee independent contractors, defined as entities or individuals that receive 1099s, whether paid or accrued, regardless of contingency: $159,776 5) Each construction project with a total cost of at least $65,000 approved by the District that is scheduled to begin on or after October 1, 2021, together with the total expenditures for such project: The District had Pond Bank 11 Repair, $86,982. 6) A budget variance based on the budget adopted under Section 189.016(4), Florida Statutes, before the beginning of the fiscal year being reported if the District amends a final adopted budget under Section 189.016(6), Florida Statutes: The FY 2022 budget was not amended. As required by Section 218.39(3)(c) and Section 218.32(1)(c), Florida Statutes, and Section 10.554(1)(i)8, Rules of the Auditor General, the Turnbull Creek Community Development District reported: 1) The rate or rates of non-ad valorem special assessments imposed by the District: General Fund $1,249.25, and Debt Service Fund $1,427.85 - $1,539.77 2) The amount of special assessments collected by or on behalf of the District: $2,593,871. 3) The total amount of outstanding bonds issued by the District and the terms of such bonds. Series 2015A1-A2, $9,585,000 matures May 2035, Series 2015B1-B2, $1,075,000 matures May 2045, and the Series 2016, $3,278,000, matures in May 2037. To the Board of Supervisors Turnbull Creek Community Development District Additional Matters Section 10.554(1)(i)3., Rules of the Auditor General, requires us to communicate noncompliance with provisions of contracts or grant agreements, or abuse, that have occurred, or are likely to have occurred, that have an effect on the financial statements that is less than material but warrants the attention of those charged with governance. In connection with our audit, we did not note any such findings. Purpose of this Letter Our management letter is intended solely for the information and use of the Legislative Auditing Committee, members of the Florida Senate and the Florida House of Representatives, the Florida Auditor General, Federal and other granting agencies, the Board of Supervisors, and applicable management, and is not intended to be and should not be used by anyone other than these specified parties. Berger, Toombs, Elam, Gaines & Frank Certified Public Accountants PL Fort Pierce, Florida October 2, 2023 INDEPENDENT ACCOUNTANTS’ REPORT/COMPLIANCE WITH SECTION 218.415, FLORIDA STATUTES To the Board of Supervisors Turnbull Creek Community Development District St. Johns County, Florida We have examined Turnbull Creek Community Development District's compliance with Section 218.415, Florida Statutes during the year ended September 30, 2022. Management is responsible for Turnbull Creek Community Development District’s compliance with those requirements. Our responsibility is to express an opinion on Turnbull Creek Community Development District’s compliance based on our examination. Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and, accordingly, included examining, on a test basis, evidence about Turnbull Creek Community Development District’s compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on Turnbull Creek Community Development District’s compliance with the specified requirements. In our opinion, Turnbull Creek Community Development District complied, in all material respects, with the aforementioned requirements during the year ended September 30, 2022. Berger, Toombs, Elam, Gaines & Frank Certified Public Accountants PL Fort Pierce, Florida October 2, 2023